Joseph Nachman - Page 25

                                               - 25 -                                                  
            reasonable cause and not willful neglect.  Sec. 6651(a)(1).                                
            Reasonable cause means that the taxpayer exercised ordinary                                
            business care and prudence, but could not timely file the return.                          
            Sec. 301.6651-1(c)(1), Proced. & Admin. Regs.                                              
                  Petitioner contends that he had reasonable cause for not                             
            filing by October 15, 1989, because he did not have his financial                          
            records until July 1990.  We have held that an illness which kept                          
            taxpayers from their records was reasonable cause for late                                 
            filing.  Hayes v. Commissioner, T.C. Memo. 1967-80.  However,                              
            here, petitioner did not claim illness or similar reason for not                           
            having his records.  Rather, he testified that his records were                            
            in storage in a room about 6 feet high, 7 feet wide and 9 feet                             
            long, packed with furniture and boxes.  He looked for the box,                             
            but did not find it until he moved everything out of the storage                           
            area in July 1990.  He had his records in storage since May 1989.                          
            Petitioner did not explain why there was a 3-month delay between                           
            when he found his records (July 1990) and when he filed his                                
            return (October 1990).                                                                     
                  Petitioner contends that he had reasonable cause for not                             
            filing earlier because he believed that he would get a refund.                             
            We have held that a taxpayer's failure to timely file a return                             
            because he or she believed no taxes were due is not reasonable                             
            cause under section 6651(a)(1).  Colbert v. Commissioner, T.C.                             
            Memo. 1992-30; Worm v. Commissioner, T.C. Memo. 1980-481;                                  
            Armaganian v. Commissioner, T.C. Memo. 1978-305; Fox v.                                    




Page:  Previous  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  23  24  25  26  Next

Last modified: May 25, 2011